Microeconomics Answers

Differentiate between private goods and public goods and then illustrate and discuss why in the 

provision of private good the summation is horizontal while it is vertical in the case of the provision 

of public good.

Critically discuss any three Macroeconomic and at least two Microeconomic reasons for growth 

in government expenditure. 

Which of the following statements is/are correct about a firm operating in a perfectly 

competitive market?

[1] The market price is given by the firm’s average variable cost.

[2] The firm has perfect information and consumers have imperfect information.

[3] The level of production efficiency is greater in the long run than in the short

4] The firm faces the same demand schedule as its marginal revenue.

In competitive markets, what do business owners do when the minimum wage rises? How does this affect the teenagers ? explain the suitable reason for the same.

A survey indicated that chocolate is the most popular flavour of ice cream in America. For each of the following indicate the possible effects of demand or supply or both as well as equilibrium price and quantity of chocolate ice cream

a) A severe drought in the Midwest causes dairy farmers to reduce the number of milk-production cattle in their herds by a third. These dairy farmers supply cream that is used to manufacture chocolate ice cream

How do inefficiencies occur in the market due to externalities.?Explain with Diagram

in what Circumstance Adverse Selection and Moral hazard different. Can one exist without the other.

How do inefficiencies occur in the market due to externalities.? Explain.

explain Quasi Rent and Monopolistic exploitation 

 "Is there a ideal way aggregating individual preferences into Social preferences". Explain using Arrow impossibility theorem. Also give the various voting options with examples.